CII Posts $26.4-Million Loss for 1st Quarter
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CII Financial Inc., a workers’ compensation insurer beset by rising claims, reported a $26.4-million first-quarter loss, compared with a year-earlier profit of $2.65 million.
The Burbank-based company, whose main operating unit is California Indemnity Insurance Co., said the loss reflected a $23.6-million addition to its reserves to cover claims losses--an addition CII had previously said it would have to make. CII’s revenue in the quarter ended March 31 rose to $29.9 million from $25.5 million.
After CII announced the loss Friday, its stock was pummeled and it closed Monday at $2.875 a share in American Stock Exchange composite trading.
CII again complained about “a very hostile environment” for workers’ compensation insurers in Southern California, saying rising fraud and “stress and strain” claims are making it hard to underwrite the insurance profitably.
As a result, CII is trying to move its business largely to Northern California and Colorado. In July, it plans to move its headquarters to Pleasanton in Northern California.
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